TMI Blog1991 (1) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... the building held by the assessees as co-owners should be assessed in the hands of the assessees individually according to their respective shares; however, in respect of the income from letting of the air-conditioning plant, the same was to be assessed as the income of an association of persons. In the meanwhile, there were several consequential proceedings before the Income-tax Officer and, ultimately, the Revenue invoked the jurisdiction of the Appellate Tribunal to rectify its order, so that, an appropriate assessment could be made under section 86(v) of the Act against the assessees individually. For this purpose, section 254(2) was invoked on the ground that there was a mistake apparent from the record, inasmuch as, the assessees b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idually should be considered in isolation from the proceedings pertaining to the association of persons. From the admitted facts, it is clear that both proceedings are closely connected and were interdependent. The width of the concept of "mistake apparent from the record" can be understood by referring to three decisions. In Maharana Mills (Pvt.) Ltd. v. ITO [1959] 36 ITR 350, the Supreme Court held that "record" does not mean only the order of assessment but "it comprises all proceedings on which the assessment order is based" and that, while exercising the power of rectification, the whole evidence and the law applicable thereto can be looked into. In Kil Kotagiri Tea and Coffee Estates Co. Ltd. v. ITAT [1988] 174 ITR 579, the Kera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve operation as in the case of subsequent legislation or the decision of the Supreme Court. A subsequent binding decision of the Supreme Court or of the High Court has retrospective operation and overruling is always retrospective." In CIT v. Shakuntala Rajeshwar [1986] 160 ITR 840, the Delhi High Court had to consider almost an analogous case on facts and, in connection with the scope of the power of rectification, held that when the earlier order of the Tribunal was founded on a mistaken assumption and the error is discovered, power under section 254(2) can be invoked. The very basis of the earlier order required rectification. In view of the foregoing, we have no hesitation to answer the question referred to us in the affirmative and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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